City of London

If you need help understanding the property licensing rules in the City of London you have come to the right place! We are experts in housing regulation and have produced this free guide to help you understand the council’s property licensing schemes.

If you find that you need a licence for your rented property our support doesn’t end there. We can handle the licence application process and give you expert advice and guidance along the way (read here). Once you have read through our guide, if you do need any assistance you can contact us here.

We also have a Landlord Suppliers Directory (here) to help you find the goods and services you need in the London area, with new suppliers regularly added.

To help set the scene, the City of London, often referred to as the Square Mile, covers an area of just 1.1 square miles in the heart of London. It is bordered by the boroughs of Westminster to the west, Camden, Islington and Hackney to the north and Tower Hamlets to the east, with the River Thames to the south. According to the 2011 Census, about 32% (1 in 3) of the housing stock was privately rented which is significantly higher that the London average of 25% (1 in 4).

Do I need a licence to rent out my property?

You do not need a licence if you rent your property to a single family as the City of London do not operate a selective licensing scheme.

You will need a mandatory HMO licence if your property meets the standard test, self-contained flat test or converted building test HMO definition in section 254 of the Housing Act 2004 and is occupied by five or more people.

But what are these tests and what does this mean in practice? It means you need a licence for any house or flat that is occupied by five or more people who are not all related and live in the property as their main home. For example, it includes:

Shared houses and flats occupied by students and young professionals;

Properties converted into bedsits with some shared facilities; and

Properties converted into a mixture of self-contained and non self-contained accommodation.

Prior to 1 October 2018, the mandatory HMO licensing scheme only applied to properties that were three or more storeys in height, but that restriction has now been lifted.

The government have decided to exclude purpose built self-contained flats within a block comprising three or more self-contained flats from the mandatory HMO licensing scheme. While this will be good news for some landlords, it does make the licensing scheme far more complicated.

To find out more, you can read our free guide to mandatory HMO licensing (here).

How much does a licence cost?

In January 2015, the City of London told us that they charge an HMO licence fee of just £110 for the whole property which was by far the cheapest licence fee amongst all London Boroughs.

However, in 2019 the fee increased substantially to £1,050 for a property with up to five lettings. Properties with more lettings are charged a higher fee. The maximum fee is £1,650 for properties with 20 or more lettings. The same rates apply to licence renewals.

The fees we’ve listed were correct as of October 2019 but could be subject to change in the future. You can view the fees in full on the council’s website. You will need to download the licence application form and the fees are listed on page 14.

How do I apply for a licence?

Unfortunately, there is no online application system - it’s a bit old fashioned but it's hardly surprising as they have very few licensable HMOs. However, you can download a licence application form from the council’s website.

If you need assistance with your licence application, you can find companies offering a licence application handling service in our Landlord Suppliers Directory (here). We also handle some applications, although we specialise in more complex cases where we provide our clients with expert advice and assistance. Our licence application handling service is explained here.

It is important to remember that submitting a licence application is only the start of the licence approval process. To help landlords understand what happens next, we have published a free guide here.

Are there any standards I need to comply with?

When we checked in February 2019, we found HMO standards have been published on the council’s website.

It is important to note that new absolute minimum bedroom sizes for licensed HMOs have been introduced for HMO licence applications approved on or after 1 October 2018:

4.64m2 for a child under 10 years old

6.51m2 for one person over 10 years old

10.22m2 for two people over 10 years old

The council can still ask for larger minimum sizes. These new minimum sizes apply throughout England to HMOs licensed under a mandatory HMO or additional licensing scheme.

How many properties has the Council licensed?

When we last checked in May 2019, we found that the City of London had licensed six HMOs.

Every council must have a public register of licensed HMOs which is regularly updated. The City of London public register is available online and can be viewed on the council's website. You will need to select 'HMO licence' from the drop down list.

Are there lots of unlicensed properties still out there?

The City of London don’t think so. In May 2019 they told us they think there are about ten licensable HMOs and several more applications were being processed.

What happens if I don't get a licence?

Ignore the law and you could pay a heavy price. You risk being prosecuted by the Council and if found guilty you could get a criminal record, be fined an unlimited amount and ordered to pay court costs and a victim surcharge.

Alternatively, the council can issue you with a civil penalty notice of up to £30,000 for not having the correct licence without any warning being given, so this is really serious stuff.

You could also be subject to a Rent Repayment Order and may have to repay up to 12 months rental income.

And following a successful prosecution, you would probably fail a fit and proper person assessment, making it very difficult for you to obtain a property licence in the future.

Don’t put your livelihood and reputation at risk. Make sure you comply with the law. We can help you get your property licensed! (find out more)

Does the Council take much housing enforcement action?

The City of London did not take any housing prosecutions over the four years from April 2011 to March 2015, but it is the smallest local authority in London and only covers the ‘square mile’ in the heart of London.

The City of London did not obtain any Rent Repayment Orders from the landlords of unlicensed HMOs over the six years from April 2011 to March 2017. This is based on data published by the Courts and Tribunals Judiciary.

For all the latest information, you can search for housing prosecutions on the Mayor of London’s ‘Rogue landlord and agent checker’, available here.

How many accredited landlords are there?

There are landlord accreditation schemes operated by the London Landlord Accreditation Scheme, the National Landlords Association (NLA) and the Residential Landlords Association (RLA).

Whilst we don’t have any figures for the NLA or RLA schemes, we have got information about the London Landlord Accreditation Scheme that is supported by all the London Boroughs. In January 2016, they told us there were 297 accredited landlords in the City of London, which was below the London average of 493, but it is a very small area!

By January 2018, that figure had increased to slightly to 306, and by January 2019, that figure had increased to 311, which is the lowest when compared to all the London boroughs. To find out more about becoming accredited, you can visit the London Landlord Accreditation Scheme website here.

In addition to training and development, accredited landlords are entitled to various benefits, including discounted licensing fees in some boroughs. If you are not already a member, we would encourage you to think about joining!

Is the Council planning to introduce any new licensing schemes?

No, in January 2015 the City of London told us they have no plans to introduce an additional or selective licensing scheme. They are keeping things simple!

We will continue to monitor the situation and will keep you posted if anything changes.

Do I need planning permission for my HMO?

You will need planning permission if you are changing your property from a single-family property to a house in multiple occupation (HMO) occupied by more than six people. HMOs occupied by more than six people fall within ‘sui-generis’ use for which planning permission is required. You also need planning permission if you a splitting up a property into smaller self-contained units of accommodation.

For smaller HMOs, the rules are a bit more complicated. HMOs occupied by between three and six people fall into planning use class C4 whereas single-family properties fall into planning use class C3.

In February 2016, we checked with the City of London and were told they do not have an HMO Article 4 Direction in force.

This means that you do not need planning permission for a change of use from a single-family property (use class C3) to a small HMO shared by three to six unrelated residents (use class C4), although the situation could change in the future.

Remember that this is only intended as general advice and no liability can be accepted for any reliance upon information provided. We would strongly encourage you to contact the Council’s Planning Department or seek independent legal advice before you start a new HMO development. More information about Article 4 Directions can be found on the council’s website.

Can you help me find the goods and services I need?

We certainly can. We understand the challenges of being a private landlord and so we have developed a Landlord Suppliers Directory to provide you with access to the goods and services you need. The Directory concentrates on businesses that operate in the London area.

Whether you a looking for a letting agent, want a property inventory for a new tenancy or fire risk assessment, we have got it covered – and far more besides!

As the leading experts in property licensing, we also offer a range of services ourselves. From handling the licence application process to advice on new HMO developments, we can help to ensure your property business remains compliant. If you need assistance, please drop us a line and see if we can help!

New suppliers are regularly being added and we would encourage you to take a look. Some of our featured listings also contain YouTube videos, helping you to find out more about the business.